A more focused and streamlined NOR Flash memory manufacturer is being moulded during its bankruptcy protection period, yet certain elements of Spansion’s recovery plan remain vague. Importantly, Spansion increased its cash position to US$220 million at the end of the second quarter, despite declining sales of US$376 million.

"Spansion is executing well against its plan and these results are evidence of our strong performance,” noted John Kispert, Spansion President and CEO. “The company delivered higher than forecasted net sales, decreased operating expenses and significantly improved its cash balances, providing solid momentum for emergence from Chapter 11 in the fourth quarter,"

Although the company has stated that it would focus design and production at the embedded memory solutions market, and not continue with investments in NOR flash memory for mobile phones, Spansion is still highlighting a subset category of focus dubbed ‘mobility.’ It is unclear at this time what this sector incorporates.

It is also unclear what will happen with Spansion’s 300mm fab in Japan. Spansion noted in a statement that due to the separate bankruptcy filing for Spansion Japan in Japan, it could not include financial results and balance sheet information of this once subsidiary into its financial statements.

With a potential move away from needing leading-edge process technology for mobile phone applications, Spansion could be in position that 300mm production capability is simply not required and Fab25 in Texas could meet demand on itself.

What is becoming clear is that Spansion looks in better financial shape and exiting Chapter 11 protection is likely in the fourth quarter of 2009.